Today’s Call: US Dollar Index to fall. Currently 74.44.
Rationale: It appears that the march out of US Treasuries and into cash has begun. Big banks really have no choice. With the US political establishment in gridlock on the debt ceiling there is now growing principal risk in holding US Treasuries. Without the prospect of further debt expansion to mop up all of the excess cash in the system in the short term, the Fed is resorting to the tactic of deflationary propaganda in a futile attempt to quell inflationary pressures.
Result of Call for June 9, 2011: July Corn Price Per Bushel to rise. Was $7.85-4, Currently $7.55-4. Bad Call.
Calls to Date: Good Calls: 28, Bad Calls: 21, Batting .571
Key Indicators for Tuesday, June 14, 2011
Copper Price per Lb: $4.16
Oil Price per Barrel: $99.43
Corn Price per Bushel: $7.55
10 Yr US Treasury Bond: 3.10%
FED Target Rate: 0.10% FED STILL IN DESPERATION MODE
MINT Perceived Target Rate*: 2.25%
Unemployment Rate: 9.1%
Inflation Rate (CPI): 0.4%
Dow Jones Industrial Average: 12,076
M1 Monetary Base: $2,022,700,000,000 RED ALERT!!!
M2 Monetary Base: $9,005,800,000,000 STARTING TO DRY UP? NOT!
*See FED Perceived Economic Effect Rate Chart at bottom of blog. This rate is the FED Target rate with a 39 month lag, representing the time it takes for the FED Target rate changes to affect the real economy. This is a 39 months head start that the FED member banks have on the rest of us on using the new money that is created.